Moveonboot did the trick thanks. Explorer for some reason locked the file on boot, and didn't let me rename/move/delete the file. Just said file is already in use... I actually found this bit of info from virtualdub (which I use) website:
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Ever had an AVI file that you couldn't delete, because every time you tried, you got an Access Denied or "file is already in use" error?
In Windows, it's not normally possible for a file to be locked by an application after that app exits, and very not possible for the app to have the file locked after the system has rebooted. Nine times out of ten this is caused by the Windows XP Shell Media Extension (shmedia.dll), which provides statistics and thumbnails for media files. Problem is, sometimes shmedia gets stuck on a file, and since it runs inside of Explorer, that file is effectively locked until you restart or logoff. And even that doesn't help, because after restarting, opening the folder causes it to lock the file again. Using Process Explorer from sysinternals.com is the easiest way to confirm that Explorer is holding the file open.
Deleting the file via the command-line, rather than navigating to the folder in Explorer, should work. If you're not a fan of the command-line and don't DEL the file that way, an alternative solution is to temporarily unregister shmedia.dll (regsvr32 /u shmedia.dll), restart, delete the file, and then re-register the extension (regsvr32 shmedia.dll). This is cleaner than hacking the registry to blow away the extension. I always just leave it unregistered, though, because I don't need it.
Note that there is a bad bug in older versions of VirtualDub's frameclient that can exacerbate this problem and cause it to happen for all AVI files, not just broken ones. It only happens if you have manually installed the AVIFile frameclient using auxsetup.exe and also enabled proxy mode via the proxyon.reg file; it doesn't happen if you just use VirtualDub itself, so most people won't run into this. Uninstalling the frameclient or turning off proxy mode are sufficient to fix the problem. This bug was fixed a while ago in version 1.6.0, so if you use proxy mode and are experiencing this problem, installing the frameclient from a newer version is sufficient.
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Thanks all for your help!